Yesterday, Dutch Prime Minister Jan Peter Balkenende and The Netherlands Bureau for Economic Policy Analysis (CPB) Director Coen Teulings held a joint press conference to announce CPB's provisional projections of the development of the Dutch economy.
A very brief summary of the CPB projections is as follows:
Economy - Expected economic contraction of 3.5% in 2009, which is "more severe" than the 0.75% contraction predicted by the CPB in December 2008. The CPB expects a further contraction of 0.25% in 2010.
Unemployment - Set to rise in 2009 to 5.5%. The CPB expects a further increase in 2010 to 8.75%.
Prime Minister Balkenende stated that the Netherlands is "facing a new and severe test," but the government is not anticipating "rushing into" any immediate short term decisions, despite the unemployment figures being "the most painful" aspect. In sum, the Dutch economic situation is "very serious indeed," and is in a "deep recession." The CPB will publish its definitive projections in its Central Economic Plan on March 17, 2009.
Separately, Dutch bank ING Groep NV reported yesterday its fiscal year 2008 earnings, posting a full year net loss of €171 million. Chairman of the Supervisory Board and CEO-designate Jan Hommen characterized 2008 as a year "marked by a sharp deterioration in financial results and the necessity to reinforce our capital base with the support of the Dutch State.” During a tumultuous 2008, ING shored up its balance sheet by selling its ownership interest in ING Canada for CAD $2.163 billion and its Taiwan life business for USD $600 million, along with receiving from the Dutch State both an Illiquid Assets Back-up Facility on 80% of the bank's portfolio of Alt-A mortgage-backed securities, and a €10 billion capital infusion.